Groundhog Accounting Day

February 2 is Groundhog Day observed in North America. As lived in folk culture, if a groundhog checks outside conditions this morning and sees its shadow, then six more weeks of winter are sure to follow. If the sky is overcast and the groundhog can’t see its shadow, then spring is about to arrive. A large Groundhog Day celebration is held in Punxsutawney, Pennsylvania.

Groundhog Day received a boost in popularity with the publication of the charming 1993 Harold Ramis film, Groundhog Day. Bill Murray plays an exceedingly self-centered Phil Connors who must relive February 2 over and over again until learning to serve others instead of self. I love the film, and consider it one of the finest ever made.

In the world of regulatory accounting, we can reflect on what a Groundhog Day forecast will predict, a longer time of winter or a new time of spring. It seems as if we have been reliving (metaphorically, of course) a broken world of accounting. Accounting is misapplied by corporate executives over and over again, leading to prolonged winters of scandal. Large audit firms prolong this winter because they selfishly serve their own business interests instead of the public.

Of course we all know the forecast: a longer time of winter. There is nary a hint of changed conditions that would lead to selfless reporting of corporate financial results. We seem doomed to relive past cycles of accounting scandal. Where is the accounting world’s Phil Connors? Stuck in a time warp. Just as are we.